The factors driving the global market comprise of the growing awareness about laser and its uses, remarkable research in the vertical-cavity surface-emitting laser (VCSEL) market, and growing fiber laser market. Significant increase in the use of laser diodes in several end-use markets due to a number of valuable features provided by this technology compared to traditional technology is a chief factor driving the global market. Moreover, the quick growth in electronic manufacturing and automotive industries around the world is boosting the global market. However, the major restraints for the growth of the market are lack of research & development funding for the military segment and the high initial investment required in the manufacturing of laser diodes. Projection applications for green laser diode devices are expected to create several opportunities for growth in the market during the forecast period.

Analogous to any technology which is new in the market, laser diodes are hindered by their heavy initial investment required to implement the superior technology. This hindrance could be annulled by growing demand of laser diode, which would stabilize the buyer-seller aspects. The adverse effects of extraction of rare earth minerals and environmental changes, necessary for laser diode manufacturing, is another noteworthy threat to the global market. However, increasing demand for lasers and developing applications of lasers in the healthcare vertical have the potential to annul this restraint.

Geographically, the global market is segmented into North America, Europe, Asia Pacific (APAC), Middle East & Africa (MEA), and South America (SAM). Advancement in display technologies across the globe particularly in the developing economies of APAC and MEA regions coupled with rapid growth in automotive and electronic manufacturing across both is propelling the global market. In addition, growing applications of laser diodes across end-use verticals such as military & defense, healthcare & medical, fiber optic communication and telecommunication are further expected to bolster this market, globally. The U.S. led the laser diode market in North America in 2015 at a revenue share of 59.89%. Even though there is huge demand for laser diodes in the upgrading of wireless technology, the sale of fiber lasers continues to gain momentum in North America due to their demand in FTTH applications. It is anticipated that the fiber laser technology would evolve during the forecast period and 100 Gb/s would become the norm with the focus shifting to the metro/regional landscapes. Furthermore, North America is witnessing an increased demand for laser cutting machines and industrial laser applications due to the significant use of these machines across several end-use verticals such as automotive, defense & aerospace, and consumer electronics.